Survey paints rosy picture for RI cell phone industry

Zakki P. Hakim, The Jakarta Post, Jakarta

Good news for the domestic cellular telephone industry! Nearly six million Indonesians -- over 1.5 times Singapore's population -- will likely buy a new phone within the next six months, according to a recent survey from market research company Roy Morgan.

Of the six million potential buyers, half of them will be first-time owners and 21 percent plan to replace or upgrade their current phones, while another 13 percent plan to buy additional ones.

Roy Morgan's survey suggests that cellular phone vendors, like those in the Glodok electronic market and ITC Roxy Mas in West Jakarta, should prepare an abundant stock of Nokia, Samsung and Sony Ericsson handsets. Those three brands are in the top three listed for consideration by potential buyers.

Finnish-brand Nokia -- popularly dubbed in the country as handphone sejuta umat or the cell phone for a million folks -- has become the top choice as consumers say it is "a good quality brand", "easy to use" and "good value for money".

"There are about 1.2 million people (in Indonesia), who currently own a Nokia and intend to buy a new one in the next six months. Two-thirds of them want to replace their current Nokia models, while the remaining plan to buy an additional one," Roy Morgan Research Manager Felicia Nugroho said.

Trailing Nokia in second and third place are South Korean-made Samsung and Sony Ericsson, respectively. Respondents said their consideration to pick these two brands were especially due to "good value for money".

Now that cell phone vendors know what brands to sell, what features should a cellular device have to appeal to over a million potential buyers?

The survey shows that aside from the taken-for-granted features such as colorful screens, an extended warranty, voicemail and a hands-free facility, consumers also consider it important for a handset to have games, a camera, a speaker phone and an MP3 player.

Other features such as internet and e-mail capability, as well as bluetooth and a global positioning system (GPS), meanwhile, are considered less important.

According to Felicia, Roy Morgan data is based on a sample size of 6,654 respondents across 16 provinces, which represents 87 percent of the Indonesian population aged 14 years and over.

Separately, the AC Nielsen Indonesia research firm joined confirmed the data as its recent survey conducted in Jakarta showed that consumers were attracted to cellular devices that had several functions such as a camera, an MP3 player, games and a large memory.

AC Nielsen Indonesia executive director Catherine Eddy said, however, that despite the consumers' desire for such features, the most common activities for phone use on a daily basis were text messaging (87 percent), receiving calls (85 percent), calls to other cellular phones (57 percent) and calls to fixed-line phones (48 percent).

Nielsen also found that nearly one out of four consumers here valued game-playing (24 percent) and listening to music (21 percent) as very important in a phone, while only 9 percent said taking photos was a priority.

"People want to have the features but don't necessarily make use of them," she said, adding that handsets and service providers should develop better gaming and music features.

"A focus on integrating more sophisticated gaming and music functionality could provide a competitive edge for handset and service providers in the future," explained Catherine.

However, the service providers should not develop the two features at the expense of the most important factor that local consumers looked for when choosing a provider; that would be good coverage.

Receiving (of phone calls and SMSes) is the biggest factor in choosing a provider, with 93 percent of users interviewed by Nielsen ranking "good coverage" as the most important factor in their choice.

Moreover, new players should not be discouraged by the fierce competition in the provider market, as Indonesian cellular phone users displayed a distinct lack of loyalty with 54 percent switching providers at some stage.

The switching crowd, according to Roy Morgan, within the next six months plan to switch to SIM card brands such as Simpati (41.5 percent) and Kartu AS (3.2 percent) provided by the largest telecommunications company PT Telkomsel, Telkom Flexi (6.3 percent) from state company PT Telkom and Mentari (25.3 percent) and IM3 Smart (4.8 percent) from PT Indosat.

The association of cellular service providers here expects total subscriber numbers to reach 29 million by the end of this year, compared to 25 million earlier this year.

Nielsen's research also shows that males are more likely to view their phones as a time management and work contact tool while females tend to rely on them much more for socializing or organizing their social life.

Nearly all agree that the biggest benefits are being "able to contact friends from wherever I am" and "for security reasons", Catherine said.

Nevertheless, the biggest beneficiaries of all will likely be the phone manufacturers and service providers, who are tapping into a very lucrative market indeed, with even greater potential for growth.